Question:
OK - here's a radical concept. It seems to me from reading extensively in this forum - the reason that so many O/O's are parking and/or selling off their tractors is because they can't make enough money to live a good life - let alone pay their bills. And the primary sink hole that sucks up their profit is the tractor's mortgage payment. Assuming this is near true - my question is as follows: Let's say that a wannabie O/O has enough cash - say $50K thereabouts - to simply buy a tractor outright - meaning NO monthly payments. And let's say that this O/O DOES NOT want to drive 21 days out and 2 home - rather - he would simply like to drive when he wants to drive - haul the loads that pay the best and basically just "have fun" with the job of OTR. And oh yeah - this O/O OTR wannabie is a recent driving school grad. with ZERO experience.
Question: Is there anyone out there that own's their tractor outright? If yes - is it in fact "easier" to make a "profit" and - given that there's little to no pressure to haul for a "living" - can you own your tractor outright - pick and choose your loads and in the end pocket a decent amount of profit?
Can it be done!
thanx --- cat

Answer:
Yes and no, I OWN one out right and pay mortgage on the other. Its all in the way you plaN your business and control your assets. Maintaining cash flow for any of the unexpected Problems that will come with truck ownership. I have made a good living for me and my family over the years some great some not so great. But thats the how it goes in this business.Do yourself a favor keep the money in the bank or invest it and go and drive for a year or so to see that this is your calling. Then make the jump to O/O get a feel of whats in store and take the blinders off and look at the big picture. And most of all do the research on what your getting into. trucking can be a very hard game to play if your ducks are not in a row from the get go. best of luck to ya!!! seeee yaaaa
sandpiperx

Answer:
Sandpiperx - thanx for your response. I appreciate it and surely respect your experience.
I'm wondering if there's anyone out there that would be willing to share some actual or estimated costs of ownership for a O/O that owns outright his/her own tractor. In particular, is there a relative break-even point that can be identified? Maybe in simpler terms - if you own outright a tractor that's worth say $50K - how many miles and at what average CPM would you have to establish in order just to break-even?
Here's another way to ask the same question: If you are an O/O and someone just simply GAVE you a tractor worth $50K - how would you estimate how much OTR time you would need to just to pay off the insurance, fuel, maintenance and other cost of ownership items?
Someone out there must have done this analysis at some point.
Thanx ...... cat

Answer:
If you are thinking about hobby trucking with no experience I would think again.
Call an insurance agent and get some qoutes. They may knock your socks off!
Better listen to the advise given above. Try and hope you don't like it!
Peacekeeper
America's original homeland security.....
The 2nd Amendment...
Truck drivers are not considered professionals or skilled labor except when they are on the witness stand.
www.howtobuyamerican.com


Answer:
First off, any "break-even point" is going to depend heavily on the rate you are getting. If you lease to a carrier that pays 84 cent per mile, you will drive a lot more miles to break even than at $1.10. Not only is the revenue different, but fuel and maintenance costs will be different too.
Second, unles you want to just kiss of you $50,000, which of course you don't, you have to make sure to include that $50,000 plus interest in your costs, and amortize it over the time you will have the tractor.
Peacekeeper, there have been two long strings recently which address a lot of your questions. I asked basically the same questions you are asking, but I asked them on the owner-operator forum, and I got a lot of very helpful info from owner operators. If you do a search under my name, dunnromin, you can get a lot of info from the detailed replies I received..

Answer:
Check out the link below....
They normally have FREE manuals that go into Great Detail about the EXACT questions/scenarios that you are inquiring about, however, they are currently out of the manuals BUT, you can Download the Same info from their website.
http://www.partners-in-business.com/

Answer:
Cat,
From your scenario, the biggest pitfall is not the money, its the lack of experience.
I know of no insurance company willing to provide coverage for a trucker without a minimumof 2 years verifiable log time. Now, assuming you are successful in getting the truck and obtaining your own authority and assuming there is some company willing to insure you, you'll be looking at somewhere between $7500 - 10,000 annually (possibly more). No small fee to "hobby truck".
On the other hand, if you're going to lease to a larger motor carrier with an insurance program (providing you qualify on experience), they may have some difficulty leasing a truck that is not available the majority of the time. Thus a very costly proposition for them and one they may not be willing to take.
If the motor carrier does not provide an insurance program, then you'd have to provide your own and you're back to finding an insurance company that write your coverage without any driving experience.
My suggestion is that you investigate the insurance aspect first before making such a large investment.

Answer:
I think you just got some good advise there!
Peacekeeper
America's original homeland security.....
The 2nd Amendment...
Truck drivers are not considered professionals or skilled labor except when they are on the witness stand.
www.howtobuyamerican.com


Answer:
Since your profile doesn't tell me anything about you, not even what state you're in, why don't you email me. I might have a spreadsheet that could show you a lot if you are into MS Excel. It took me a year to break even with one OTR truck, (I am a rookie to the OTR business)and I just paid it off so I have experience in both scenarios. I have another truck running locally that makes good money that I paid cash for 10 years ago.
BradBishop@pacbell.net

Answer:
How long would you be willing to sit someplace??a few days,a week,2 weeks,it would get old quick.
=======================
"I ain't paying somebody to work"
Would sooner work and complain about not getting paid for it.
Answer:
Better off with a mortgage and 50 k in the bank. Then you can run when and where you want. Not the other way around.

Answer:
Just a thought:
Heard a story at school in recent weeks, 'bout a o/o in a rollover accident (happened yrs ago). May not have all the facts straight but the jist of it was:
Truck was totaled out.
No citation issued and considered unavoidable under the circumstances.
Insurance covered only a portion of the cost of the truck but not the total.
Some insurance on the cargo covered a portion of the loss. (Remember that there is more at stake here besides your life and the equipment to transport.)
Insurance did not cover the clean up. O/O was out of pocket to cover for all expenses of uncovered losses.
Amounted to $$$$$$ !
Now it may be tempting to want to be your own boss, but in some way or another we all have to play the "please the customer" relations game with an employer (either company driver or independant pleasing the one who pays for the haul and the one who receives it at the other end).
I agree w/ Choclit and others that one considers carefully the risks involved if your wannabe o/o indulges his/her initial enthusiasm for trucking too quickly before gaining experiential wisdom first. (Other words, get the experience OTR. Make sure its the life one wants. Talk with others about the dream of truck ownership while getting the driving experience and take notes of how others succeeded and/or failed. Consider what that $50 K or so may buy in the way of security as investment, a good piece of realestate, disability insurance, or any other emergency, need or special pleasure you may wish to indulge in the future. What if it were thrown in a hole and sucked under..... a lot of what ifs and how much risks can this wannabe take and not be moved if it fails)
I plan where I'm going
'Cause I know where I've been.

Answer:
Show me an O/O, who buys his truck outright, has no truck payment, and who is rolling in dough, and in a couple of years, I'll show you a former O/O, who complains about losing all his savings on trying to be an O/O, and telling you how dumb it is to buy your own truck.
In other words, either you make payments on a truck, or put what amounts to a payment back in the bank, or in a few years, you'll be out 50k, and have a paid for truck that is to old or broken down to make a living with.
Owning a truck is a business, not a hobby, and like any business that wants to stay around long, you have to plan for the future.
I'm not saying that you have to go out there and drive til you drop, that is one of the advantages of being an O/O. You decide when you work and how hard you work, and it's different for everybody, depending on their situation and what they need, or want to get out of it, but to continue to have that freedom, you must plan ahead. If you do that then you can "have fun", and not have to spend all your time on the road, or at least, working while you are on the road. I enjoy getting paid to go to places, that most people work, and save all year long, to visit.
I own my truck outright, but I also put money in the bank every month, just like a payment, so when the time comes that my maintenance bills get to high, or I feel like it's time to get another truck, the money is there.
I'm not one of those guys that try to discourage people from becoming an O/O, I say "The waters great, come on in". Most of the ones that say you can't make it as an O/O, mostly just don't know how to run a business, and need someone to hold their hand, so being a company driver, with someone to tell them everyday, what they need to do, works well for them. You could give most of them the title to a brand new truck, and 100k in the bank, and they'd still be broke in a year.
Even though I wouldn't discourage you from becoming an O/O, you would be well served to take Sandpiperx's, and other's advice and go get some experience in someone else's truck before buying your own. There are many things that you don't know about Trucking yet, and even getting a thousand answers, to a thousand questions, you won't know if this is what you really want to do, until you've spent some time out here.
Answer:
You stated that very WELL.

Answer:
For one no experience, if someone hires you on I would be surprised. Let alone now you are driving equipment that you have bought with no experience, god forbid you hit your first snow storm or patch of ice. Newbies on the road scare me sometimes let alone a newbie with their own truck that is ungoverned. I'm not saying all newbies because I have seen quite a few good newbies. You insurance rates will be higher, you won't have anything to claim for tax deductions. Dunno but that is just a frightening thought.
George
www.pctechtalk.com